The cryptocurrency market crashed on January 7, liquidating long position bullish traders by over $630 million in 24 hours. As of today, January 8, cryptocurrencies continue to show weakness, which some investors consider as an opportunity to accumulate more.
Precisely, data we gathered from CoinGlass this morning show that $631.52 million were liquidated from long positions. This is a significant domination over the total liquidations in the last 24 hours, summing up to $711.30 million.
Overall, 237,701 traders lost their collateral money due to the liquidations, mostly trading “Others” low-cap cryptocurrencies. One single Ethereum (ETH) trader lost $17.41 million alone, betting on the ETH/USDT pair on Binance.
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From the “Others” category, traders lost $171.12 million to liquidations. Meanwhile, ETH traders lost $152.32 million and Bitcoin (BTC) $128.12 million. Long positions also dominated each of these categories, with $163 million, $131.50 million, and $111.40 million liquidations, respectively.
AI meme coins boom and doom
Indeed, the massive loss from “Others” is a direct result from the recent hype around low-cap AI-related meme coins. This asset class has recorded an impressive surge since the end of 2024, attracting billions of dollars, as Finbold reported.
Their popularity among traders led to big markets like Binance to list AI16Z, FARTCOIN, and ZEREBRO tokens for Futures trading.
Essentially, these AI cryptocurrencies are benefiting from significant developments in the artificial intelligence industry, creating financial buzz and hype. For example, Sam Altman, ChatGPT’s creator, recently forecasted AGI and AI agents joining the workforce in 2025, fueling the narrative.
However, these low market cap and low liquidity coins offer more risks and suffer the most from volatility. Big investors, with a relevant share of tokens, can easily move the price to a desired direction, triggering massive liquidations.
Bitcoin (BTC) price analysis
As of this writing, Bitcoin is trading at $95,580, down 5.65% in the last 24 hours.
According to the finance best-selling author, Robert Kiyosaki, this crash represents “great news” for BTC investors.
“Bitcoin crashing. Great news. I continue buying Bitcoin because Bitcoin crashing means Bitcoin is on sale,” Kiyosaki said in a post. “Remember ‘Buy low… and HODL.’ Less than 2 million more Bitcoins to be mined,” he concluded.
Indeed, bullish investors who buy cryptocurrencies like Bitcoin on spot have less to worry about during these crashes. On the other hand, crypto traders who bet on derivatives, usually with leverage, will often be victims of high volatility events, effectively losing money to liquidations, as happened during this most recent crash.
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